HCA Previews 2016 Operating Results

January 09, 2017 08:30 AM Eastern Standard Time

NASHVILLE, Tenn.--(BUSINESS WIRE)--HCA Holdings, Inc. (NYSE: HCA) today announced it expects Income before
income taxes to be approximately $4.5 billion and Adjusted EBITDA to be
approximately $8.2 billion for the year ended December 31, 2016. The
Company anticipates reporting fourth quarter 2016 results of operations
and guidance for 2017 on January 31, 2017. A table reconciling Income
before income taxes to Adjusted EBITDA is included in this release.

Same facility admissions for the fourth quarter of 2016 are expected to
increase approximately 1.6 percent, same facility equivalent admissions
are expected to increase approximately 1.5 percent and same facility
emergency room visits are expected to increase approximately 1.6 percent
from the prior year’s fourth quarter.

The Company is scheduled to present Monday, January 9, 2017 at 8:00 am
(PST) at the J.P. Morgan Healthcare Conference being held at the Westin
St. Francis Hotel in San Francisco, CA. A link to the live audio webcast
is available and copies of the related presentation materials will be
available at the Investor Relations section of the Company’s website, www.hcahealthcare.com.

Forward-Looking Statements

This press release contains forward-looking statements within the
meaning of the federal securities laws, which involve risks and
uncertainties. Forward-looking statements include statements that do not
relate solely to historical or current facts and are subject to
finalization of the Company’s fourth quarter financial and accounting
procedures. Forward-looking statements can be identified by the use of
words like “may,” “believe,” “will,” “expect,” “project,” “estimate,”
“anticipate,” “plan,” “initiative” or “continue.” These forward-looking
statements are based on our current plans and expectations and are
subject to a number of known and unknown uncertainties and risks, many
of which are beyond our control, which could significantly affect
current plans and expectations and our future financial position and
results of operations. These factors include, but are not limited to,
(1) the impact of our substantial indebtedness and the ability to
refinance such indebtedness on acceptable terms, (2) the impact of the
Patient Protection and Affordable Care Act, as amended by the Health
Care and Education Reconciliation Act (collectively, the “Health Reform
Law”), including the effects of any repeal of, or changes to, the Health
Reform Law, the possible enactment of additional federal or state health
care reforms and possible changes to other federal, state or local laws
or regulations affecting the health care industry, (3) the effects
related to the continued implementation of the sequestration spending
reductions required under the Budget Control Act of 2011 (the “BCA”),
and related legislation extending these reductions, and the potential
for future deficit reduction legislation that may alter these spending
reductions, which include cuts to Medicare payments, or create
additional spending reductions, (4) increases in the amount and risk of
collectability of uninsured accounts and deductibles and copayment
amounts for insured accounts, (5) the ability to achieve operating and
financial targets, and attain expected levels of patient volumes and
control the costs of providing services, (6) possible changes in
Medicare, Medicaid and other state programs, including Medicaid upper
payment limit programs or waiver programs, that may impact
reimbursements to health care providers and insurers, (7) the highly
competitive nature of the health care business, (8) changes in service
mix, revenue mix and surgical volumes, including potential declines in
the population covered under managed care agreements, the ability to
enter into and renew managed care provider agreements on acceptable
terms and the impact of consumer driven health plans and physician
utilization trends and practices, (9) the efforts of insurers, health
care providers and others to contain health care costs, (10) the outcome
of our continuing efforts to monitor, maintain and comply with
appropriate laws, regulations, policies and procedures, (11) increases
in wages and the ability to attract and retain qualified management and
personnel, including affiliated physicians, nurses and medical and
technical support personnel, (12) the availability and terms of capital
to fund the expansion of our business and improvements to our existing
facilities, (13) changes in accounting practices, (14) changes in
general economic conditions nationally and regionally in our markets,
(15) the emergence and effects related to infectious diseases; (16)
future divestitures which may result in charges and possible impairments
of long-lived assets, (17) changes in business strategy or development
plans, (18) delays in receiving payments for services provided, (19) the
outcome of pending and any future tax audits, disputes and litigation
associated with our tax positions, (20) potential adverse impact of
known and unknown government investigations, litigation and other claims
that may be made against us, (21) the impact of potential cybersecurity
incidents or security breaches, (22) our ongoing ability to demonstrate
meaningful use of certified electronic health record technology, and
(23) other risk factors described in our annual report on Form 10-K for
the year ended December 31, 2015 and our other filings with the
Securities and Exchange Commission. Many of the factors that will
determine our future results are beyond our ability to control or
predict. In light of the significant uncertainties inherent in the
forward-looking statements contained herein, readers should not place
undue reliance on forward-looking statements, which reflect management’s
views only as of the date hereof. We undertake no obligation to revise
or update any forward-looking statements, or to make any other
forward-looking statements, whether as a result of new information,
future events or otherwise.

All references to “Company” and “HCA” as used throughout this release
refer to HCA Holdings, Inc. and its affiliates.

HCA Holdings, Inc.

Supplemental Non-GAAP Disclosures

2016 Operating Results Forecast

(Dollars in millions)

For the Year Ended

December 31, 2016

Income before income taxes

$

4,500

Gains on sales of facilities

(25

)

Losses on retirement of debt

5

Legal claim costs

45

Income before income taxes, excluding gains on sales of
facilities, losses on retirement of debt and legal claim costs (a)

4,525

Depreciation and amortization

1,965

Interest expense

1,710

Adjusted EBITDA (a)

$

8,200

The Company's forecasted operating results are based on current
expectations and are subject to finalization of the Company's
fourth quarter financial and accounting procedures.

(a)

Income before income taxes, excluding gains on sales of facilities,
losses on retirement of debt and legal claim costs, and Adjusted
EBITDA should not be considered as measures of financial performance
under generally accepted accounting principles ("GAAP"). We believe
income before income taxes, excluding gains on sales of facilities,
losses on retirement of debt and legal claim costs, and Adjusted
EBITDA are important measures that supplement discussions and
analysis of our results of operations. We believe it is useful to
investors to provide disclosures of our results of operations on the
same basis used by management. Management relies upon income before
income taxes, excluding gains on sales of facilities, losses on
retirement of debt and legal claim costs, and Adjusted EBITDA as
primary measures to review and assess operating performance of its
health care facilities and their management teams.

Management and investors review both the overall performance
(including income before income taxes, excluding gains on sales of
facilities, losses on retirement of debt and legal claim costs, and
GAAP income before income taxes) and operating performance (Adjusted
EBITDA) of our health care facilities. Adjusted EBITDA and the
Adjusted EBITDA margin (Adjusted EBITDA divided by revenues) are
utilized by management and investors to compare our current
operating results with the corresponding periods during the previous
year and to compare our operating results with other companies in
the health care industry. Gains on sales of facilities, losses on
retirement of debt and legal claim costs are very difficult to
predict, can vary significantly from period to period, do not
directly relate to the ongoing operations of our health care
facilities and complicate period comparisons of our results of
operations and operations comparisons with other health care
companies.

Income before income taxes, excluding gains on sales of facilities,
losses on retirement of debt and legal claim costs, and Adjusted
EBITDA are not measures of financial performance under GAAP, and
should not be considered as alternatives to income before income
taxes or net income attributable to HCA Holdings, Inc., as a measure
of operating performance, or cash flows from operating, investing
and financing activities, as a measure of liquidity. Because income
before income taxes, excluding gains on sales of facilities, losses
on retirement of debt and legal claim costs, and Adjusted EBITDA are
not measurements determined in accordance with GAAP and are
susceptible to varying calculations, income before income taxes,
excluding gains on sales of facilities, losses on retirement of debt
and legal claim costs, and Adjusted EBITDA, as presented, may not be
comparable to other similarly titled measures presented by other
companies.